German economy cuts marketing budgets due to pandemic
This will force a rethink of B2B marketing spending. Just under one in two marketing managers is already expecting a sharp reduction in the budget. These are the results of the study "B2B Marketing Budgets", the ninth edition of which was published by the Bundesverband Industrie Kommunikation e.V. (bvik). "For all providers and players involved in the field of trade fairs and live events, the year 2020 is an 'annus horribile' with far-reaching consequences," says Dr Andreas Bauer, bvik board member. "The downward trend of the past few years is continuing in internal and external B2B marketing expenditure."
Cuts for B2B marketing in Germany and worldwideAs the study shows, external B2B marketing expenditure in 2020 - for the most part still without the corona effect - fell by an average of three percent compared to the previous year. The global budgets for externally purchased marketing and communication services are also affected by this, with a decline of around two percent. In 2019, international activities had still increased against the general trend.
Due to the pandemic, 46 percent of the experts surveyed expect marketing budgets in Germany as a whole to decline – 30 percent expect strong savings and 16 percent slight ones. Globally, 61 percent of the experts believe that the budget will be cut back: 34 percent expect major cuts and 27 percent slight cuts. Internal and external B2B marketing expenditure taken together had already declined in the previous year and recorded a drop of 23 percent from 2018 to 2019.
Outlook 2021Management and sales are looking for alternatives to compensate for the cancelled trade fairs and live events. While digital sales and communication channels were important even before the pandemic, they have found unprecedented acceptance in the crisis. This development increases the importance of marketing experts who develop and implement new online formats.
"As market observers, we assume that B2B marketing in Germany will have to prepare for hard times," says Prof Dr Carsten Baumgarth from the University of Applied Sciences (HWR) in Berlin and scientific director of the bvik study. "Burying your head in the sand is not an option. New topics like 'Digital Marketing Leadership', 'Purpose Orientation' or 'New Brand Management' are three important future topics that offer new opportunities. Despite all budget restrictions, decision-makers should invest in the skills and abilities of their own employees. The lean, agile and innovative years will come."